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| Money Metals News Alert | December 30, 2024 – The stock market may finally be rolling over amid some weak economic numbers coming in the door.
We've seen downward revisions of the government's economic data from recent months.
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Also, there has been unexpectedly persistent inflation numbers, increasing war drums, and some general uncertainty about what policy changes will come from the new Administration.
Last week, gold was down by a slight 0.1% and is trading lower on Monday. With less than two trading days left in the year, gold is still showing a robust gain of about 25% in 2024.
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Meanwhile, silver fell 10 cents last week and is down another 40 cents today. Like gold, silver has pulled back over the last 8 to 10 weeks, but is still showing a yearly gain of $5 or about 20% right now.
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 | Gold : Silver Ratio (as of Friday's closing prices) – 75.4 to 1 | | |
| A Prior Fed Chair Admitted Gold's Competition with Dollar; Powell Lies | | | |
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In his essay at MoneyMetals.com this week marking the 50th anniversary of the re-legalization of monetary gold in the United States in 1974, researcher and author Stuart Englert noted the opposition by Arthur Burns, then chairman of the Federal Reserve Board.
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That opposition remains especially noteworthy today because of some details in Burns' testimony to Congress about gold legalization on December 5, 1974, testimony Englert this week called to our attention here and here.
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Burns' opposition was weak as he framed it himself – mainly a matter of fear that if private gold ownership became legal again, Americans suddenly might move all their savings into the metal, sparking speculation in silver and commodities and a wave of inflation. Burns saved his true concern about the legislation for the end of his testimony.
Burns wrote: "The risks associated with a reopening of the gold market extend also to the exchange value of the dollar in international markets. Apart from sales by the Treasury, any substantial demand for gold by our citizens would have to be met by gold imports. The consequence might be a worsening of our international balance of trade and downward pressures on the dollar in foreign exchange markets.
"These pressures on the dollar could, of course, be checked by sales of gold from our nation's monetary reserves. But there are risks associated also with this course of action. | | | |
| "Since the precise role of gold in the international monetary system is yet to be determined, it would hardly be desirable to dispose of any sizable part of our reserve assets. Clearly, therefore, various adverse consequences for our financial markets and our economy may stem from a reopening of the gold market at the end of this month. No one can now say with any confidence how serious these consequences are likely to be. | | | | |
"The risks associated with private ownership of gold are, however, postponable, and I see no material advantage to the nation in incurring these risks under present circumstances...
"We should be ready, nevertheless, to make prudent use of the Treasury's holdings if demands for gold threaten to have adverse economic or financial consequences.
"For example, if large imports of gold exerted significant downward pressure on the exchange value of the dollar, prices of imported products would rise, and this would tend to worsen our inflationary problem. Sales from the Treasury's gold stock could lessen this difficulty, and I therefore endorse the Treasury's intention to auction 2 million ounces of gold early in January." | That is, Burns first told Congress that gold would compete with the dollar as a currency and store of value, and, second, that this would compel the U.S. government to try to defeat the competition by intervening in the gold market to knock the price down, as by strategic sales from the U.S. gold reserve.
Contrast Burns' begrudging candor in 1974 with the assertion made early this month by his latest successor as Fed chairman, Jerome Powell: that gold and bitcoin compete with each other but not with the dollar:
What has changed since 1974 to prevent gold from competing with and potentially disciplining the dollar's excesses? | | |
Nothing at all.
What has changed is only that the highest government officials now regularly lie about gold, and that the most important financial news organizations now refuse to ask critical questions about government policy on gold.
Even a single critical question could explode the whole racket.
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For example, the U.S. Commodity Futures Trading Commission could be asked whether it has jurisdiction over manipulative futures trading in the monetary metals undertaken by or at the behest of the U.S. government, or whether such manipulative trading is outside the commission's jurisdiction and perfectly legal.
GATA and U.S. Rep. Alex Mooney, R-West Virginia, repeatedly have put that question to the commission and have repeatedly been refused an answer.
Unfortunately the New York Times, Washington Post, the Financial Times, and the Wall Street Journal, along with all other mainstream financial news organizations, have not yet dared to ask and to report the answer or refusal to answer.
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| This week's Market Update was authored by Chris Powell of the Gold Anti-Trust Action Committee. | | |
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| This copyrighted material may not be republished without express permission. Offer only available through email promotion. Offer does not apply to previous orders and may not be combined with any other offer or program. Special shipping rates or other restrictions may apply to international orders. The information presented here is for general educational purposes only. Money Metals Exchange and its staff do not act as personal investment advisors. Nor do we advocate the purchase or sale of any regulated security listed on any exchange for any specific individual. While our track record is excellent, investment markets have inherent risks and there can be no assurance of future profits. You are responsible for your investment decisions, and they should be made in consultation with your own advisors. By purchasing from Money Metals, you understand our company is not responsible for any losses caused by your investment decisions, nor do we have any claim to any market gains you may enjoy. Money Metals Exchange is not a regulated trading "exchange" as defined by the CFTC and the SEC. | | |
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